Albon (t/a N A Carriage Co) v Naza Motor Trading SDN BHD & Anor

For service out of the jurisdiction, a claim need not arise under a contract to be a claim “in respect of” it. The phrase extends to a claim sufficiently connected with the contract, including a restitutionary claim for repayment of sums paid on account under it. The applicant must also establish a good arguable case under the relevant gateway, a serious issue to be tried, and England as the clearly appropriate forum. Defects or non-disclosure on a without-notice application do not automatically require discharge. The court must consider proportionality and the overriding objective. Permission should be maintained where the defects have not affected the jurisdictional decision, but set aside where non-disclosure goes to the merits or materially deprives the court of the information needed to exercise its discretion.

The claimant, an English motor-car dealer, brought claims against a Malaysian company and its principal shareholder arising from several oral agreements concerning motor-car trading, commissions and expenses. A Master granted permission to serve the proceedings out of the jurisdiction. The defendants applied to set aside that order, alleging that the relevant gateways, merits and forum requirements were not satisfied and that material matters had not been disclosed.

The present judgment determined only whether permission to serve out should stand. The court considered separately claims under the UK Agreement, the South African Agreement and the Expenses Agreement, including the proper law, the seriousness of the issues, the appropriate forum and the effect of non-disclosure.

1. Applicable requirements. The applicant had to show a good arguable case that each claim fell within an applicable gateway, a serious issue to be tried, England as the clearly appropriate forum, and grounds for exercising the discretion to permit service. The court could cure procedural irregularities under CPR 3.10, but could not rely on a new gateway not advanced on the original application.
2. UK Agreement. The phrase “in respect of a contract” in CPR 6.20(5) was wider than “under a contract”. It covered a restitutionary claim connected with the contractual relationship. Payments made on account under the agreement and subject to later accounting supplied the necessary connection. The claim raised a serious issue, the agreement was most closely connected with England, and England was the appropriate forum.
3. The proper-law analysis under the Rome Convention, incorporated by the Contracts (Applicable Law) Act 1990, favoured English law. The characteristic performance was the claimant’s agency service in England, and the presumption in favour of the place of the performer’s habitual residence or business was not displaced.
4. The deficiencies in the evidence and disclosure concerning the UK Agreement were serious, but there was no deliberate intention to mislead. Setting aside permission would have been disproportionate and contrary to the overriding objective. Permission was therefore maintained, subject to a costs sanction.
5. South African Agreement. Although the claim might fall within the letter of a gateway, South African law was the proper law and South Africa was the suitable forum. Material facts concerning the invoices, the absence of earlier demands and limitation had not been disclosed. Permission was set aside.
6. Expenses Agreement. The gateways and English forum requirement were satisfied, but the Master had been materially misled about limitation, alleged payments on account, credits and set-offs. Those matters went to the heart of the application. Permission was set aside.